According to a PTI report: SoftBank — the largest shareholder in Snapdeal — had secured a go-ahead from the founders last month. However, NVP was not in agreement over the valuation suggested by the Japanese firm and hectic parleys were held in the last few weeks to resolve the impasse.
According to people familiar with the matter, SoftBank Group has now reached an agreement with NVP to move ahead with the sale plan.
They said the term sheet with Flipkart could be signed within this week and the due diligence for the deal would commence immediately thereafter, PTI reported.
Sources told PTI Snapdeal founders would get about US $25 million each, while NVP could get close to US $100 million and stake in the merged/new entity. Kalaari could get about US $70-80 million.
Emails sent to Snapdeal, SoftBank, NVP and Kalaari did not elicit any response to PTI.
Snapdeal was valued at US $6.5 billion in its last funding round in February 2016. The valuation, however, has shrunk since then and the potential deal could see Snapdeal being valued at about US $1 billion, said market watchers.
SoftBank said it suffered a loss of US $1 billion (Rs 6,500 crore) on its investment in Snapdeal during 2016-17, almost matching the money it put in the home-grown marketplace.
As per regulatory filings, SoftBank currently owns over 30 per cent in Snapdeal, while Nexus has roughly a 10 per cent stake and Kalaari holds 8 per cent share in the firm.
The deal between Snapdeal and Flipkart, if completed, would mark the biggest acquisition in the Indian e-commerce space and change the landscape of the sector that is witnessing intense competition among players.
Indian e-commerce companies have seen funding dry up over the last few months as investors are focusing extensively on profitability and rationalisation of expenses.
With intense competition from deep-pocketed global rivals like Amazon, companies like Flipkart and Snapdeal could face more heat in the coming days.